Sanae Takaichi was elected as Japan's 104th Prime Minister and the country's first female leader on October 21, 2025, with her new cabinet inaugurated the same day. Key appointments include Satsuki Katayama as Finance Minister and Hisashi Matsumoto as Digital Minister, alongside a coalition with Nippon Ishin no Kai, which is set to shape the "Tax Reform 2026" highly anticipated by the crypto industry.
The Financial Services Agency (FSA) has formally submitted a proposal to revise the current crypto income tax system from Comprehensive Taxation (up to 55%) to Segregated Taxation (a flat 20%), aligning it with stocks and FX trading. The FSA also seeks to allow the creation of crypto asset ETFs and has greenlit banks to hold Bitcoin (BTC), fueling international optimism. Exchanges like Bitunix have expressed hope for an Asian crypto boom under the new administration.
A central tension lies between Digital Minister Matsumoto, who is expected to advance Web3 initiatives, and Finance Minister Katayama, who emphasizes fiscal discipline and defending the Japanese yen against foreign financial influence. The coalition with Ishin, led by Hirofumi Yoshimura, aims to accelerate tokenization, including Security Tokens (ST) and stablecoins, for regional financial revitalization. Major banks—Mitsubishi UFJ, Sumitomo Mitsui, and Mizuho—plan to jointly issue yen-pegged stablecoins by March 2026 using Progmat's infrastructure, with a potential USD stablecoin to follow.
Market reaction has been positive, with the Nikkei 225 surging on Takaichi's victory, reflecting investor confidence in deregulation and technology-friendly policies. The administration must balance tax cuts with economic security, aiming to establish a yen-based digital economic sphere while addressing risks like financial crime.
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